Internet hospital forecast for 2020: less than 9 billion market size

After the wave of Internet medical care receded, especially at a time when the development of pharmaceutical e-commerce has also been caught in the bottleneck, the market is becoming increasingly silent. In such a market situation, the Internet hospitals with remote consultation as the core are getting more and more attention.
From the point of view of telling stories to the market, Internet hospitals are indeed a very trend-setting product, on the one hand, very consistent with the classification of treatment policy, on the other hand, can effectively obtain users and continue to profit from drugs, which is extremely in line with the current market ecology, is still dependent on products rather than services profit, services are dependent on products. Moreover, as the policy restrictions on public hospitals become more and more stringent, internet hospitals are becoming a tool for some hospitals to circumvent policy controls in order to meet the limits on the proportion of drugs and the number of patients they receive.
in such a market demand, Internet hospitals have achieved rapid development. In the medium term, however, Internet hospitals are not a high-growth market, largely due to the accessibility of China's health-care system and the low-level nature of the payment system. China's health care system is very accessive, there is no problem of foreign doctors to queue for several days, at the same time, China's medical services are very cheap, there is no need to control fees through remote consultation. The difficulty with the demand for China's medical service system is mainly in the demand for famous doctors, which is mainly focused on the need for registration, rather than the need for remote consultation. Moreover, the volume of this demand is very small and cannot support an industry.
in order to better understand the Internet hospital market, we have made a market size forecast for this market. According to our projections, this market will be less than 9 billion in size by 2020, mainly from pharmaceutical revenues, even under extremely optimistic conditions. This market size forecast does not include the remote consultation market, but only for minor and chronic diseases mainly common diseases. The remote consultation market is not included because remote consultation is essentially a business between hospitals in which third parties are difficult to develop and can only be a role in providing basic equipment and software. Especially with Medicare's coverage of the remote consultation market, it will be difficult for third-party companies to derive large-scale legal revenue from it.
Overall, Internet hospitals are a market that can deliver a certain amount of revenue, which is more interesting than Internet healthcare, which has no business model at all, but it's always a very small market, and it's focused on drugs, not a market that can do a lot of it."
below we will briefly analyze the size of the remote consultation market in the cloak of an Internet hospital.
the scale of remote consultations is closely related to three variables. The first is the speed and range of the cloth point. From the current development of remote consultation, the market is very strong regional, the need for local government support policies and administrative support can be rapidly launched. Therefore, for the pilot provinces, the speed of the locations in primary medical institutions, small hospitals and retail pharmacies will be closely related to the number of remote consultation clinics throughout the region. One of the most promising development is retail pharmacy outlets, especially chain pharmacies, once established cooperation, will be able to quickly and in large quantities to promote cloth points, very beneficial to expansion. In contrast, the pace of operation in grass-roots institutions and small hospitals is relatively slow, and due to the different technical strength of the institutions, the ability to provide medical services, their own ability to attract patients is not the same, in the relatively good service capacity of the organization is more likely to obtain passenger flow.
second key variable is the amount of customer access obtained by a single cloth point. Our calculations show that the current remote consultation can get 0.5 people per single day, may increase in the future, but due to the overall strength of Primary Health Care in China is not strong, the growth rate of single-point access will not be too fast, increased to 1 person or 1.5 people will be a great leap. Major service growth in the next three to five years, still need to increase the scope of the point to promote.
third variable is the proportion of prescriptions available remotely and the cost of medicines. Due to the remote consultation service fee reference offline registration fee, relatively stable, it is difficult to change significantly, the most likely to affect the size of the market is the prescription situation. At present, 60% of the remote consultation services in Guangdong's second hospital will be prescribed, with an average prescription of 60 yuan. This amount is lower than the average prescription cost of $136 for outpatient clinics in level 3 hospitals in 2014 and $83 for level 2 hospitals, and close to the average prescription amount for level 1 hospitals of $66. Remote consultation at this stage is mainly for conventional diseases, coupled with the retail side or grass-roots drug, the price is relatively cheap, so the average future prescription amount will not be too high.
However, if continuous prescriptions for chronic diseases are liberalized and related remote follow-up and chronic disease management services are introduced in conjunction with chronic disease treatment, it will be possible to gradually transfer more prescriptions to the remote end, which may affect the average amount of prescriptions for remote consultations. However, this change will continue to occur regionally, and the pace and scale of development will depend on the policy support of local governments.
In response to these important variables, we have set four key indicator assumptions, including two dosing indicators, namely, the proportion of coverage in basic medical institutions (including primary and secondary hospitals) and the proportion of retail pharmacy coverage, and the percentage of single-day access to telemedicin.
the number of visits and the average amount of prescriptions per remote visit, based on the three variations of these four variables, we calculated the market size of telemedic services.
important indicator against the overall medical service market is the proportion of remote outpatients accounting for offline outpatients. From the experience of the United States, Teladoc's representative remote consultation model has a conversion rate of about 3%, which will be lower than in the United States because telemedicin in China is just beginning and grass-roots and retail pharmacies are far less important than in the United States. We believe that in the next five years, the proportion of
-distance consultation services in the proportion of offline emergency services in the range of 0.5% to 1.5% will be reasonable.
the remote consultation market is divided into services and drugs. Under the basic circumstances, the scale of services and the size of drugs are 480 million yuan and 2.24 billion yuan, respectively, and the overall market size of remote consultation is 2.7 billion yuan. Taking guangdong Province as an example, the number of single-day remote outpatient visits can reach 18,000, accounting for 0.5% of the province's offline outpatient visits.
If the coverage of cloth points increases, the number of single-point guests increases and the amount of prescriptions increases slightly, the overall market size of remote consultations may be in the range of 5.47 billion yuan to 8.89 billion yuan under the optimistic and extremely optimistic growth. The service scale reached 870 million yuan to 1.35 billion yuan, while the drug scale reached 4.6 billion yuan to 7.5 billion yuan. (Diary of the Villageman)